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Is Halifax the catalyst for the Maritimes’ resurgence? : Senator Greene
September 8, 2017
image Stephen Greene
Stephen Greene
CSG - (Nova Scotia - Halifax - The Citadel)

When people ask me where I live, of course I say “Halifax,” and they usually remark that I am very lucky. My response used to be a rather defensive, “Well, it’s getting better,” even though I wasn’t sure. These days, I am likely to return a more positive, “And it’s getting better all the time!”

There’s no question that Halifax has that feel. For the past few years, the city skyline has been decorated with construction cranes the likes of which we haven’t seen before. The source of that investment is renewed confidence in the city’s future. The new architecture is most impressive and makes us proud.

But surely the investment coming into the city is an anomaly when set against the stark regional statistics we know almost by heart. These describe an aging population, declining health services, low immigration, outmigration, static population growth, expensive university tuition, high public sector wages, high taxes, high public debt, high minimum wages, and too much government for our own good.

In short, the city’s growth, which is real, seems to be in spite of what is happening around it.

Or perhaps the city’s growth is because of the low rates of growth around it. Because Maritimers never want to leave their region, they are flocking to Halifax as a last hope before going down the road. Can Halifax be an engine of growth for the whole region?

Thirty years ago, when the groundfish fishery was booming with year-round plants in coastal areas were attracting permanent workforces, the population of Halifax was less than a third of the province; now it is about half and rising. The city’s growth is being fuelled by migration, not from outside the region, but from inside, mainly from Nova Scotia, but also from New Brunswick and P.E.I., too.

Halifax is growing, but the region is not.

Against this backdrop and my own buoyant feelings for Halifax’s future, I recently read Professor Donald Savoie’s book, “Looking for Bootstraps: Economic Development in the Maritimes.”

Note the title of his book. First of all, “Bootstraps.” He asks what Maritimers can do by themselves ‑‑ to pull themselves up by their own bootstraps without waiting for Ottawa to do something first.

Second, note the title says, “in the Maritimes.” He does not say “in Atlantic Canada.” This was no accident. Prof. Savoie points out that the term “Atlantic Canada” is an Ottawa construct, not a natural regional one. Lumping us all in the same basket makes it easier for Ottawa to deal with us.

Our natural region is the Maritimes, Savoie says – same history, same culture, same geography, same economy, same people, same problems and, perhaps, same solutions – and composed of three provinces.

His analysis reinforces my belief that a missing ingredient to our economic development is to focus on the Maritimes region as a single entity and to find ways to blend, co-ordinate and offer public services within the three provinces with the goal of acting in concert both within and outside the region.

This could lead to gains in productivity as a result of lower per capita costs of government and lower taxes, sparking investment.

Those who wish to know the history of how we got to be where we are should read this book. Savoie describes how we were shunted aside in the years following Confederation, as opportunities were grabbed first by Central Canada. With our region divided into three provinces, it was a three-way scramble for the leftovers.

He describes in detail the lost opportunity of the Chignecto Canal that would have connected the Northumberland Strait with the Bay of Fundy and resulted in a tremendous boost in trade, but was sunk due to a squabble between New Brunswick and Nova Scotia.

Beginning roughly 75 years ago, we began to be annually thrown money in the guise of economic development that spawned decades of Department of Regional Economic Expansion, Department of Regional Industrial Expansion, Atlantic Canada Opportunities Agency and politically motivated handouts.

Savoie points out that the alphabet soup of federal development programs hasn’t worked, so he is now promoting community growth models.

One of these models could be akin to what Jim Meek recently wrote in this newspaper, recommending investments in soft services like urban bike lanes and hiking trails to attract high-tech jobs and investments that reposition Halifax as a “smart” city.

We also need to invest in more immigration, post-secondary education, health care, startup incubators, more user pay, and reducing government; all of the things that Ray Ivany recommended.

The region should look for inventive ways to gain a competitive edge that will attract new businesses and people. With provincial budgets and debt loads leaving little room for premiers to maneuver, it may be time to look at outside-the-box ideas to give our economy a positive jolt.

Here’s one crazy idea:

I note that ACOA spends about $225 million annually in our region with an additional $75 million in administrative costs. This expenditure, courtesy of Canadian taxpayers, is about $300 million a year and helps the few companies that get the grants and loans. At the same time, the region contributes about $900 million in corporate taxes paid by all businesses.

Wouldn’t it be a boost to the region if we got rid of ACOA, which benefits a few, and trade it for a one-third drop in federal business taxes, which would benefit all?

This would cost the federal treasury not one extra nickel. And it would attract new investment, be a magnet for new companies as well as give established businesses of all sizes a boost.

While unorthodox ideas like these would benefit all businesses in the region, they might confirm Halifax’s growth, as it is home to so many. We should start to perceive Halifax’s potential as an engine of growth for the entire region and do what we can to further such growth.

If our growth is fuelled primarily by people coming from the region, it may have limits.

At the risk of being optimistic, an almost fatal condition in the Maritimes, I ask: “Does what is happening in Halifax represent a developmental paradigm shift? Is Halifax ‘taking off,’ to use Walt Rostow’s old phrase? Will the city’s growth begin to feed on itself, creating continuous growth that will spill over to the benefit of the entire region?”

Is Halifax the regional bootstrap that Savoie has been looking for?

Stephen Greene is a senator representing Nova Scotia.

This article appeared in the August 23, 2017 edition of the Chronicle Herald.